Yesterday during our mini case presentation we discussed the power of word-of-mouth (WOM), one of the topics to be discussed in Thursday’s lecture. But as you can all imagine, influence differ among people and it is hard for companies to reach those that have a high influence to optimally use WOM.
In 2009 two guys started the company Klout to overcome this problem. Klout measures the influence of people online. As they state on their website: “our friendships and professional connections have moved online, making influence measurable for the first time in history. When you recommend, share, and create content you impact others. Your Klout score measures that influence on a scale of 1 to 100.”
In an interview with Forbes, CEO and co-founder Joe Fernandez explains Klout.
As Joe says in this interview, companies can use Klout to offer the influential consumers perks, which I think is one of the main reasons that consumers have their Klout score measured in the first place.
Some more examples of the use of Klout can be found in this article on AdAge.
Consumer Value Creation 
Thanks for sharing Aram!! I think that’s a great approach into finding good metrics for social word-of-mouth. Besides that, my feeling is that by introducing such an approach, may even make customers to share even more to increase their score! Would be cool if we could find how the use of Clout might influence their behavior and, in turn, the spread of communication messages of the companies attached to them.
One thing I am wondering though is how consumers will coop with different treatments from companies.
Imagine this: someone with a high Klout score gets a free room upgrade in a hotel and afterwards tells everyone about his experience. Then 10 people with low or no Klout score follow his advice and also visit this hotel. Since they don’t score so high, they do not get the “special treatment.” If these 10 then share their “negative” experience, their combined power might be higher than that of the first person who did get treated well. The hotel might end up with more negative than positive WOM.
It’s a case of expectations. If you raise them by offering some influential people special treatments, others might consider it a basic and will complain if they don’t get it….